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A Texas judge struck down the Energy Discrimination Elimination Act targeting ESG-focused firms including BlackRock<\/a> and HSBC. A Texas judge\u2019s move to strike down a state law blacklisting \u201cwoke\u201d financial firms, including BlackRock and HSBC, that used environmental, social or governance factors in investment decisions will likely drive a broader push to repeal so-called \u201canti-ESG\u201d laws in other states, analysts said.\n<\/p>\n Texas lawmakers passed the Energy Discrimination Elimination Act in 2021, requiring state agencies and local authorities to break ties with and divest the shares of companies that refused to invest in some oil and gas companies, targeting the likes of BNP Paribas and Danske Bank on its list. About 14 other states followed suit.<\/p>\n A federal judge in Texas said the law was unconstitutional last week, ruling that it violated First Amendment free-speech protections because it punished businesses for speaking about fossil fuels<\/a> and associating with organizations that oppose fossil fuels. Texas said it would appeal the verdict.\n<\/p>\n It was \u201ca home-court loss for Texas,\u201d said K&L Gates attorney Lance Dial. \u201cYou would think if there\u2019s any place they could make this stick, it\u2019s Texas.\u201d\n<\/p>\n Roadmap for challenges <\/p>\n Bryan McGannon, managing director at the U.S. Sustainable Investment Forum, said the ruling provides a \u201croadmap\u201d for challenges to similar laws passed in\u00a0Oklahoma, Kentucky, West Virginia, Tennessee and Utah, as well as other policies that target environmental, social or corporate governance activities, or ESG.\n<\/p>\n \u201cThe ruling\u2019s challenge to the faulty premise that climate or ESG considerations must be motivated by social or political purposes and ignores \u2018ordinary business purpose\u2019 clears the way to contest many anti-ESG laws,\u201d he added.\n<\/p>\n Anti-ESG action has taken a variety of forms, including laws targeting diversity efforts and the use of lawsuits, including one from Texas and other states accusing investors of breaching antitrust laws when assessing corporate climate efforts.\n<\/p>\n Data from climate-policy advisory firm Pleiades Strategy, which tracks anti-ESG laws, shows there are currently 26 at various stages of development in U.S. states including in Alaska, Georgia, Michigan, Minnesota and Nebraska.\n<\/p>\n However, since it began tracking the bills in 2022, 391 had been killed off before making it into law.\n<\/p>\n Wildfires, floods\n<\/p>\n Insurer Munich Re said in January that the cost of damages caused by natural disasters such as floods and wildfires, which scientists say are increasing in frequency and intensity because of climate change, totaled $224 billion in 2025.\n<\/p>\n Overall losses from wildfires in Los Angeles, the most expensive wildfire disaster to-date, were around $53 billion, of which only $40 billion was insured, it added.\n<\/p>\n And some of the world\u2019s biggest companies have cited issues linked to the world\u2019s transition to a low-carbon economy, for example patchy incentives and consumer demand for greener products, as a driver of results.\n<\/p>\n Stellantis last week became the latest in a string of automakers to write down the value of their EV investments, taking a $27-billion hit that sent its shares down 30%.\n<\/p>\n Given the need to assess such climate-related financial risks<\/a>, laws like the one in Texas were merely designed to \u201cpolitically punish\u201d investors, said Ben Cushing, campaign director for sustainable finance<\/a> at the Sierra Club.\n<\/p>\n Despite the laws\u2019 \u201cchilling effect,\u201d Cushing said the Texas ruling should instead give investors confidence that managing climate-related risks was consistent with their fiduciary duty.\n<\/p>\n Frances Sawyer, founder of Pleiades Strategy, agreed: \u201cIt is yet another court ruling protecting the freedom to invest. This should be a strong signal that the overreach of anti-ESG laws has more bark than bite.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Listen to this article Summary: A Texas judge struck down the Energy Discrimination Elimination Act targeting ESG-focused firms…\n","protected":false},"author":2,"featured_media":159838,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[65661,24238,65662,458,65663,27,29,2934,28],"class_list":{"0":"post-159837","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-texas","8":"tag-anti-esg-laws","9":"tag-blackrock","10":"tag-climate-related-financial-risks","11":"tag-fossil-fuels","12":"tag-sustainable-finance","13":"tag-texas","14":"tag-texas-headlines","15":"tag-texas-law","16":"tag-texas-news"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/159837","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/comments?post=159837"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/159837\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media\/159838"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media?parent=159837"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/categories?post=159837"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/tags?post=159837"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nThe ruling found the law violated First Amendment free-speech protections by punishing businesses for fossil fuel-related speech and associations.
\nThe decision provides a legal roadmap for challenging similar anti-ESG laws<\/a> in multiple other U.S. states.<\/p>\n